In an absurdly lengthy opinion, which I must admit to only skimming,
the Third Circuit has held that a ten-by-ten foot subleased office makes
Delaware the principal place of business of a GlaxoSmithKline holding company,
and thus upheld diversity jurisdiction over a personal injury action involving thalilomide.
(Yes, thalilomide, the
anti-nausea-in-pregnancy drug from the late 50's and early 60's that caused
birth defects.)Plaintiffs claim to have
discovered new evidence showing that defendants were aware of the drug's
defects while marketing it. Johnson v. SmithKline Beecham Corp., No. 12-2561 (3d Cir. June 7, 2013.)

The plaintiffs are Pennsylvania citizens and they claimed that
four defendants were also Pennsylvania citizens. So when defendants removed the
action from Pennsylvania state court, plaintiffs moved to remand. That motion
was denied and the issue certified for interlocutory appeal. Apparently the
issue of these companies' citizenship for diversity purposes has come up in
several other cases and the district court rulings have conflicted.

As a naive law student, I concluded that any corporate
structure that I could not understand was up to no good, and I have found no
reason to change my mind about this well into middle age.Three of the four defendants that plaintiffs claimed
were Pennsylvania citizens are entities affiliated with GlaxoSmithKline plc, the
British entity that is the "global head" of the GlaxoSmithKline group
of companies.Defendant SmithKline
Beecham Corp. was once a Pennsylvania corporation, but it converted in 2009 to
a Delaware LLC.As far as I understood,
the purpose of the conversion was to avoid "unnecessary tax
liability."(Wish I could convert
myself to a Delaware LLC!)SmithKline
Beecham then dissolved.The court thus
held that SmithKline Beecham was not a Pennsylvania citizen because it had
converted itself into a new entity, defendant GSK LLC.

GSK LLC operates the US division of GlaxoSmithKline plc.Its headquarters is still in Philadelphia, "where
it occupies 650,000 square feet of office space and employs 1,800 people" –
the same as when it was still SmithKline Beecham.SmithKline Beecham's board of directors
became GSK LLC's "board of managers."Does that mean GSK LLC's principal place of business is still Pennsylvania?

No.As an LLC, GSK
LLC's citizenship for diversity purposes is derivative of its owner's (or
"member's") citizenship.Its
sole member is GSK Holdings, a Delaware corporation with its principal place of
business in (according to the Third Circuit) Delaware.GSK Holdings subleases a ten-by-ten foot
office in Delaware.It has one employee
who works about 20 hours per year.Its three
directors hold quarterly 15-30 minute meetings in Delaware (at least one of the
directors is usually physically present at the meetings) to discuss GSK
Holdings' investments.

As for the fourth defendant at issue, Avantor, it evidently moved
its principal place of business to Pennsylvania five days after the removal, so
the court held that it was still a New Jersey citizen at the time of removal.